Garment surplus hits 6.5 billion USD

The textile and garment sector posted an export surplus of 6.5 billion
USD in 2011, 1.5 billion USD higher than last year's figure, according
to the Vietnam Textile and Apparel Association (Vitas).

The surplus
has brought the industry's localisation ratio – the percentage of
materials used by textile and garment companies that are produced
locally – to 48 percent.

In spite of high inflation, the country's
garment exports to key markets experienced significant growth, such as
Japan (52 percent), the EU (41 percent) and the US (14 percent).

Le
Tien Truong, Vitas' vice chairman, attributed growth in the sector to
well-conducted market forecasts, efficient investment and production and
growing efforts by exporters to win the trust of international
partners.

However, experts suggested the industry should reduce dependence on imports.

Greater
production of raw materials in the future would help the industry meet
major export contracts and reduce business risks due to fluctuations in
raw material prices in the world market, they said.

It should also
gradually evolve from contract manufactures to original design
manufacturers (ODM) to increase value and win more FOB (Free on Board)
orders from foreign clients, they said.

By the year-end, ODM
contracts earned the sector just 800 million USD, accounting for 5
percent of its total export turnover, Vitas said, adding that the
industry aimed to raise the ratio to 15 percent in 2015 and 20 percent
in 2020.

Despite hidden challenges globally, the sector has targeted a
15 billion USD export turnover in 2012, a surge of 12 percent against
last year's figure./.